Technical analysis – EURUSD battles with the bearish trend; major support at 1.1611
EURUSD found new sellers below its simple moving averages (SMAs), stretching the pullback from the bottom of the ascending channel slightly below the Ichimoku cloud and towards September’s trough of 1.1611.
The downward-sloping RSI combined with a bearish MACD, which has snapped below its signal and zero lines, is indicative of a strengthening bearish bias. Meanwhile, the red Tenkan-sen line is also set for a bearish crossover with the blue Kijun-sen, adding to the discouraging signals.
Still, the wall around 1.1611 remains in place, and only a break below it would re-activate the downfall from the 1.2009 peak and thus generate fresh selling, likely towards the 1.1500 level. Lower, the area around 1.1420 has been restrictive to upside and downside movements during the 2018-2020 period and therefore would be closely watched if the decline continues.
In the event the 1.1611 trough holds firm, the price may revisit Friday’s resistance of 1.1700 before meeting its 20- and 50-day SMAs currently standing around 1.1765. Moving higher and above the cloud, the bulls may push harder to breach the tough block between 1.1860 and 1.1880 and reach the bottom line of the channel at 1.1930.
In brief, EURUSD is trading bearish in the short-term picture, with the 1.1611 number expected to act as immediate support to additional losses. If not, the pair would exit the four-month-old range, confirming the start of a down-trending market.
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